Article excerpt

DANBURY, Conn. - Union Carbide Corp. says its
expense-cutting plan, including elimination of 4,000 white-collar
jobs, is part of a decade -old restructuring move, but analysts say
Carbide is reacting to earlier mistakes and that ""the world's gone
the wrong way for them.''

Union Carbide Chairman Warren M. Anderson said the seven-step plan
announced Wednesday would improve the company's financial position
and better its safety and environmental measures.

He said the steps are designed to save about $300 million and
substantially improve Union Carbide's return on equity.

They include reducing the white-collar workforce by about 15
percent - 4,000 jobs - taking a substantial charge against 1985
earnings, selling some assets and buying back about 14 percent of its
own outstanding stock.

""These are very defensive moves,'' said James M. Arenson, an
analyst with Dolandson, Lufkin Jenrette Securities. He said the
company had finally realized ""they had made a mistake in expanding
(inthe early 1970s). The world's gone the wrong way for them. They
should have done this long ago.''

Anderson's management has come under broad criticism for both a
slow response over the years to unfavorable economic conditions and
for a series of chemical leaks at three company plants.

Since December, chemical leaks at Union Carbide factories have
killed more than 2,000 people in Bhopal, India, injured 135 in
Institute, W.Va., and fouled water supplies in South Charleston,
W.Va.

Most of the staff reductions likely would be accomplished through
early retirement, said spokesman Tom Failla. But the company was
offering a voluntary severance plan and Failla did not rule out the
possibility of layoffs.

As to where the reductions would occur, he said, ""The units have
not been identified yet.'' Union Carbide employs 48,400 people in
domestic operations and another 46,700 in other countries, he said.

Carbide also planned to generate about $500 million by continuing
its sale of ""non-strategic assets.'' The company was not specific,
but in the past it has de-emphasized its petrochemical, metals and
carbons segments in favor of higher-growth and more profitable
consumer products, industrial gases and technology services.

The company said the program will result in a total, non-recurring
pre-tax charge against 1985 earnings of $990 million that will reduce
after-tax earnings per share by about $8. …